U.S. Labor Market Remains Tight Despite Technology Sector Layoffs

• The number of Americans filing new claims for unemployment benefits fell last week, showing widespread layoffs remain low despite a surge in technology-sector job cuts that has raised fears of an imminent recession.
• The weekly jobless claims report from the Labor Department on Thursday, the most timely data on the economy's health, suggested the labor market remained tight. That, together with solid consumer spending, keeps the Federal Reserve on track to continue raising interest rates, though at a slower pace amid signs inflation was starting to subside.
• Initial claims for state unemployment benefits dropped 4,000 to a seasonally adjusted 222,000 for the week ended Nov. 12. Economists polled by Reuters had forecast 225,000 claims for the latest week.
• There has been an increase in layoffs in the technology sector, with Twitter, Amazon (AMZN.O) and Meta (META.O), the parent of Facebook, announcing thousands of job cuts this month. Companies in interest-rate sensitive sectors like housing and finance are also letting workers go.
• The layoffs have so far not been evident in official data. Unadjusted claims dropped 6,101 to 199,603 last week. Economists say businesses outside the technology and housing sectors are hoarding workers after difficulties finding labor in the aftermath of the COVID-19 pandemic. With 1.9 job openings for every unemployed person in September, some of the workers being laid off are probably finding new employment quickly.

(Source: Reuters)